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A Reprint of Economic Tracts 

Edited by 

JACOB H. HOLLANDER, Ph. D. 

Associate Professor of Political Economy 
Johns Hopkins University 



Sir Edward West 

on 

The Application of Capital to Land 

1815 



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OCT 3 1903 

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INTEODUCTION 

A careful student of the history of economic theories has de- 
scribed Sir Edward West as "the first, though not the name-father 
and greatest of the 'Ricardian' school,"^ and has added in further 
explanation, " It is impossible to read West's pamphlet without 
seeing that the form in which the ' law of diminishing returns ' 
was subsequently taught, and the phraseology in which it was ex- 
pressed, are far more due to him than is imagined by those who 
only know him as the subject of a civil reference in Ricardo's 
preface." - 

This comparative neglect dates back to West's contemporaries. 
" I have read his book with attention, and I find that his views 
agree very much with my own," wrote Ricardo to iVIalthus on 
March 9, 1815.* In 1817, in the Preface (iv) to the " Principles 
of Political Economy and Taxation," Ricardo deliberately linked 
West with Malthus as having " presented to the world, nearly 
at the same moment, the true doctrine of rent." But a year 
later (September 18, 1818), his verdict expressed to Hutches 
Trower was distinctly vaguer: " His pamphlet was ingen- 
ious, and he had a glimpse of the true doctrine of rent and 
profits." * In Ricardo's subsequent writings, formal and informal, 
West is not again referred to. Malthus and James Mill make no 
mention of him. Even McCulloch, whose scent for anything 
like an ' anticipation ' of an accepted doctrine was the keenest, 
merely speaks of the rent tracts of West and Malthus as " two 
pamphlets of extraordinary merit, published nearly at the same 
moment," and then summarily disposes of both by adding, " But 
the investigations of these gentlemen, though of great importance, 
were comparatively limited in their object." ^ It was only at the 



^ Cannan, " A History of the Theories of Production and Distri- 
bution in English Political Economy from 1776 to 1848 " (London, 
1893), p. 279. 

- Ibid., p. 160. 

^ " Letters of David Ricardo to Thomas Robert Malthus, 1810- 
1823" (ed. Bonar. Oxford: 1887), p. 63. 

* " Letters of David Ricardo to Hutches Trower and others, 1811- 
1823 " (ed. Bonar and Hollander. Oxford: 1899), p. 58. 

" McCulloch, " A Discourse on the Rise, Progress, Peculiar Ob- 
jects, and Importance of Political Economy: containing an outline 
of a course of lectures on the principles and doctrines of that 
science" (Edinburgh, 1824), p. 65. Cf. also his "The Principles 



4 Introduction 

hands of ready pamphleteers, like William Jacob ^ and Arthur 
Young/ that West was accorded a larger place, and this recog- 
nition was naturally enough transient. 

Within a decade after its appearance, West's pamphlet, pseudo- 
nymous and probably of limited circulation, had been virtually 
forgotten. Even his " Price of Corn and Wages of Labour," ' 
published in 1826 with its spirited claim to the discovery of other 
economic principles then already identified as Ricardian, failed 
apparently to receive the slightest attention. Thereafter West's 
name, like James Anderson's, appears in economic writing merely 
in a crass qualification of the familiar statement that the differ- 
ential law of rent was put forth by Malthus and developed and 
applied by Ricardo. 

Bare details of West's personal life have come down to us.' He 
was born in St. Marylebone, Middlesex, in 1782,^" his family 
being well-connected and in part distinguished. He was educated 
at Harrow and Oxford, receiving the bachelor's degree in 1804, the 
master's title in 1807, and holding a fellowship in University Col- 
lege thereafter. He was called to the bar, and in 1817, pub- 
lished " A Treatise on Extents." " He relinquished academic 



of Political Economy: with a sketch of the rise and progress of 
the science" (Edinburgh, 1825), p. 265, and "The Literature of 
Political Economy" (London, 1845), p. 33. 

'^ " A Letter to Samuel Whitbread, Esq. M. P., being a sequel to 
Considerations on the Protection required by British Agriculture; 
to which are added remarks on the publications of A Fellow of 
University College, Oxford; of Mr. Ricardo, and Mr. Torrens " 
(London, 1815). 

' " An Inquiry into the Rise of Prices in Europe, during the last 
twenty-five years, compared with that which has taken place in 
England; with observations on the effects of high and low prices " 
(London, 1815), published in "The Pamphleteer" (London), 
vol. vi, pp. 165-204. 

^ " Price of Corn and Wages of Labour, with observations upon 
Dr. Smith's, Mr. Ricardo's and Mr. Malthus's doctrines upon those 
subjects; and an attempt at an exposition of the causes of the 
fluctuation of the price of corn during the last thirty years " 
(London, 1826). 

" See in particular the memoir in " The Annual Biography and 
Obituary: 1830" (London, 1830), the materials for which, we 
are told by the editor, " have been derived from a private and 
authentic source." 

'" " Dictionary of National Biography " (ed. Lee), vol. Ix, p. 329. 

" " A Treatise of the Law and Practice of Extents in Chief and 
in Aid. With an appendix of forms of writs; affidavits for ex- 
tents; pleadings to extents; rules of court; and table of fees" 
(London, 1817). 



Introduction 5 

ofl&ce and active legal practice, in which he had already attained 
a considerable measure of success, to accept the office of recorder 
of Bombay. He was knighted on July 5, 1822, and upon the 
establishment of the supreme court in 1824, was made chief jus- 
tice. His two most important public acts were rejection of the 
Calcutta regulation for controlling the press, and reformation of 
the police of Bombay. He died at Poonah in August, 1828. An 
address, signed by a large body of natives and presented to the 
surviving judges of the presidency, extols West's personal and 
judicial virtues, notably his activity in connection with the admis- 
sion of natives to jury service, and refers to a sum of money hav- 
ing been subscribed and made over to the Native Education Society 
for the establishment of " Chief Justice West's Scholarships and 
Prizes." 

West's interest in political economy was sustained. We are 
told that he commenced its study shortly after leaving Oxford and 
that " it occupied his attention, more or less, until his death." " 
But with whatever zeal pursued, the study was distinctly an 
avocation. In publishing his first pamphlet in 1815, West yielded 
to the representations of friends that interest in other pursuits 
might perhaps injure his professional career and omitted his 
name from the title page. Acquaintance with Brougham, Ricardo 
and possibly Malthus,^= exerted no influence in this direction 
and it was not until the appearance of Ricardo's " Protection to 
Agriculture " in 1822, that West again attempted formal economic 
writing. This manuscript was taken with him to India in nearly 
finished form; but delays occurred and when it finally appeared in 
1826 as " Price of Corn and Wages of Labour," the subject had 
lost much of its timeliness. West's final and most ambitious 
economic work was in preparation at the time of his death. We 
know nothing of it beyond what the author of the biographical 
memoir, referred to above, has written: " It would, probably, have 
amounted to a general treatise on the whole subject, and it had 
occupied his mind intensely for the greater part of his leisure, 
for more than a year preceding his death. He had received an 
offer from one of the most eminent publishers in London, to 
undertake the publication of it; and it is to be hoped that, at least, 
a large portion of the work has been left in a state which will 
admit of its being yet given to the world." It is at least interest- 



'^"The Annual Biography and Obituary: 1830" (London, 
1830), p. 106. 

""Letters of David Ricardo to Thomas Robert Malthus, 1810- 
1823" (ed. Bonar. Oxford: 1887) p. 63. 



6 Introduction 

ing to conjecture that had his life been prolonged, or had cir- 
cumstances marked out for him a less absorbing career than legal 
activity and far-removed judicial office, West's influence upon 
the development of English economic thought would have been 
considerable. 

West's first pamphlet, like Malthus's rent tract, owes its formal 
publication to the corn-law controversies of 1813-1815. But to 
West as to Malthus the essential principle of increasing costs in 
agriculture had occurred " some years ago," '^ and we are again 
led to the conclusion that the genesis of the law of diminishing 
returns is referable to that extraordinary condition of British 
agriculture in the preceding decade, the conspicuous features of 
which — extension of cultivation and application of capital — were 
familiar to all students of economic conditions long before parlia- 
mentary blue-books gave them wide publicity.^^ 

In the present edition the general appearance of the title page of 
the tract has been preserved, the original pagination has been in- 
dicated and a few annotations have been appended. 

Baltimore, June, 1903. 

" See p. 9, below. 

^=Cf. Introduction (p. -4) to the reprint of Malthus, "An In- 
quiry into the Nature and Progress of Rent, and the principles 
by which it is regulated" (ed. Hollander. Baltimore: 1903). 



ESSAY 

ON THE 

APPLICATION OF CAPITAL 

TO 

LAJK'D, 

WITH 

OBSERVATIONS 

SHEWING THE 

IMPOLICY 

OF 

ANY GREAT RESTRICTION OF THE 
IMPORTATION OF CORN, 

AND 

THAT THE BOUNTY OF 1688 DID NOT LOWER THE 
PRICE OF IT. 



A FELLOW OF UNIVERSITY COLLEGE, 
OXFORD. 



LONDON: 

PRINTED FOR T. UNDERWOOD, 32, FLEET STREET; 



C Roworth, Bell Yard, Temple Bar. 



1815. 



ESSAY, &c. 



The chief object of this essay is the publication of a prin- 
ciple in political economy, which occurred to me some years 
ago; and which appears to me to solve many difficulties in 
the science, which I am at a loss otherwise to explain. 

On reading lately the reports of the corn committees/ I 
found my opinion respecting the existence of this principle 
confirmed by many of the witnesses, whose evidence is there 
detailed. This circumstance and the importance of the 
principle to a correct understanding of many parts of the 
corn question, have induced me to hazard this publication 
before the meeting of parliament, though in a much less per- 
fect shape than I think it would have assumed had I been 
less limited in point of time. I shall first proceed to prove 
this principle, and shall then shew some of the consequences 
which flow from it. || 

The principle is simply this, that in the progress of the 
improvement of cultivation the raising of rude produce 
becomes progressively more expensive, or, in other words, the 
ratio of the net produce of land to its gross produce is con- 
tinually diminishing. 

By the gross produce I mean, of course, the whole produce 
without any reference to the expense of production; by the 
net produce, that which remains of the gross produce after 
replacing the expense of production. 

In the progress of cultivation both the gross produce and 
the net produce must be constantly increasing; for addi- 



10 Sir Edward West 

tional expense or capital would not be laid out on land, 
unless it would reproduce not only sufficient to replace the 
capital laid out, but also some increase or profit on that capi- 
tal, which increase or profit is the net produce. But the 
proposition is, that every additional quantity of capital laid 
out produces a less proportionate return, and consequently, 
the larger the capital expended, the less the ratio of the profit 
to that capital. Thus suppose any quantity of land such 
that 100/. capital laid out on it would reproduce 120/. that 
is 20 per cent, profit, I say that a double capital viz. 200/. 
would not reproduce 240/. or 20 per cent, profit, but probably 
230/. or some less sum than || 240/. The amount of the 
profit would no doubt be increased, but the ratio of it to the 
capital would be diminished. 

It is a fact acknowledged by all writers on political econ- 
omy, that in the progress of improvement of any country, the 
productive powers of labour in agriculture improve less rap- 
idly than the productive powers of labour in manufactures; 
or rather to express the same proposition more accurately, 
the productive powers of labour in raising rude produce im- 
prove less rapidly than the effective powers of labour in 
manufacturing it. This phenomenon has hitherto been ac- 
counted for solely by the impossibility of carrying the sub- 
division of labour, and the consequent introduction of ma- 
chinery, so far in agriculture as in manufactures. " The 
nature of agriculture," says the author of the Wealth of 
Nations, " does not admit of so many subdivisions of labour, 
nor of so complete a separation of one business from another, 
as manufactures. It is impossible to separate so entirely the 
business of the grazier from that of the com farmer, as the 
trade of the carpenter is commonly separated from that of 
the smith. The spinner is almost always a distinct person 
from the weaver: but the ploughman, the harrower, the 
sower of the seed, and the reaper of the || corn, are often the 
same. The occasions for those different sorts of labour re- 
turning with the different seasons of the year, it is impossible 
that one man should be constantly employed in any one of 



The Application of Capital to Land 11 

them. This impossibility of making so complete and entire a 
separation of all the different branches of labour employed in 
agriculture, is perhaps the reason why the improvement of the 
productive powers of labour in this art, does not always keep 
pace with their improvement in manufactures. The most opu- 
lent nations, indeed, generally excel all their neighbours in 
agriculture as well as manufactures; but they are commonly 
more distinguished by their superiority in the latter than in 
the former. Their lands are in general better cultivated, and 
having more labour and expense bestowed upon them, produce 
more in proportion to the extent and natural fertility of the 
ground. But this superiority of produce is seldom much more 
than in proportion to the superiority of labour and expense. 
In agriculture, the labour of the rich country is not always 
much more productive than that of the poor, or at least, it is 
never so much more productive as it commonly is in manufac- 
tures. The corn of the rich country, therefore, will not 
always, in the same degree of goodness, come cheaper to mar- 
ket than that of the poor. || The corn of Poland, in the same 
degree of goodness, is as cheap as that of France, notwith- 
standing the superior opulence and improvement of the latter 
country. The corn of France is, in the corn provinces, fully 
as good, and in most years nearly about the same price with 
the corn of England: though, in opulence and improvement, 
France is perhaps inferior to England. The com lands of 
England, however, are better cultivated than those of France, 
and the corn lands of France are said to be much better culti- 
vated than those of Poland. But though the poor country, 
notwithstanding the inferiority of its cultivation, can, in some 
measure, rival the rich in the cheapness and goodness of its 
corn, it can pretend to no such competition in its manufac- 
tures; at least, if those manufactures suit the soil, climate, 
and situation of the rich country." * 

The impossibility here stated of increasing sp much in agri- 
culture as in manufactures by the division of labour, and by 

* Smith's Wealth of Nations, Vol. I. B. 1. c. 1. p. 10, 11.= 



12 Sir Edward West 

machinery, the quantity of work done by any given number of 
hands, would indisputably account for a retardation of the 
improvement of the former when compared with the latter. 

6 But this, it II is necessary to observe, would account for a 
comparative retardation only ; for the effects of the subdivision 
of labour and the application of machinery are considerable 
even in agriculture ; and would greatly improve the productive 
powers of labour in that art as well as in manufactures, were 
it not for another principle, which has escaped the attention of 
Dr. Smith, and which has a positive operation in checking the 
improvement of those powers in agriculture ; which principle 
may, according to the degree in which it acts, either merely 
retard, or altogether stop, such improvement; or even render 
the powers of labour actually less productive as cultivation 
advances. 

Dr. Smith's principle is, that the quantity of work which 
can be done by the same number of hands, increases in the 
progress of improvement comparatively less rapidly in agri- 
culture than in manufactures. The additional principle to 
which I allude is, that each equal additional quantity of work 
bestowed on agriculture, yields an actually diminished re- 

7 turn,* II and of course if each equal additional quantity of 
work yields an actually diminished return, the whole of the 
work bestowed on agriculture in the progress of improvement, 
yields an actually diminished proportionate return. Whereas 
it is obvious that an equal quantity of work will always fabri- 
cate the same quantity of manufactures. 

Lay aside for a moment the considerations of the subdivision 
of labour and machinery, and suppose that each workman 
independently could do as much work as each in association. 
In such a state of things, such manufactures as were made 

* It will be observed that in this reasoning I measure the pro- 
ductive powers of labour by the effects produced, and not by the 
quantity of work done. Thus a good workman will do more work 
than a less skilful one; but if the work of the latter be bestowed 
on a grateful soil, it may produce a greater effect than the work 
of the former bestowed on an inferior soil. 



The Application op Capital to Land 13 

would be constantly in the progress of improvement, made 
with equal labour, and the increase of their quantity (suppos- 
ing the price of rude produce to be given,) would be exactly 
proportioned to the labour bestowed in fabricating them. A 
million of men would make neither more nor less in propor- 
tion to their number than one. But would this be the case 
in agriculture? Consider the case of a new colony; the first 
occupiers have their choice of the land, and of course cultivate 
the richest spots in the country: the next comers must take 
the second in quality, which will return less to their labour, 
and so each successive additional set of cultivators must ne- || 
cessarily produce less than their predecessors. 

Again, look to the history of agriculture, from its first rude 
beginning, immediately after the pastoral state when almost 
the whole of the produce was still spontaneous, to the state of 
perfection at which it has arrived in this country, in which 
the mode of culture has approximated to gardening. 

In the pastoral state, the only labour of the tribe is that of 
tending their cattle and driving them to fresh pastures from 
those which they have exhausted ; the flocks multiply without 
trouble, and are maintained by the spontaneous produce of 
the soil. As population advances it is necessary to have re- 
course to agriculture; in this state somewhat more labour is 
necessary to support even the same number of mouths ; but yet 
it is at first small if compared with the quantity of produce ; 
the cultivators till successively the richest spots, which yield 
profuse returns to the slight cultivation which is bestowed 
upon them ; and the cattle which share with man the labours 
of the field, wander over immense tracts, fed, as in the pastoral 
state, by the spontaneous productions of nature. As each cul- 
tivator is driven into a narrower compass by the pressure of 
population, he is obliged to till soils which are comparatively || 
ungrateful and exhausted: the cattle are fed on artificial 
grasses; and expensive manures are brought from a distance 
to enable the land to yield successive crops, instead of being 
left, when exhausted, as in the earlier stages of improvement, 
to renovate itself. This mode of proof, however, to render it 



14 Sir Edward West 

complete, would require more space than the limits of this 
essay would allow, and a greater accumulation of facts than I 
can at present collect. I shall therefore attempt a briefer 
demonstration of the principle. 

The additional work bestowed upon land must be expended 
either in bringing fresh land into cultivation, or in cultivat- 
ing more highly that already in tillage. In every country 
the gradations between the richest land and the poorest, must 
be innumerable. The richest land, or that most conveniently 
situated for a market, or, in a word, that which, on account 
of its situation and quality combined, produces the largest 
return to the expense bestowed on it, will of course be cul- 
10 tivated first,* and when in the progress of improve- || ment 
new land is brought into cultivation, recourse is necessarily 
had to poor land, or to that at least which is second in quality 
to what is already cultivated. It is clear that the additional 
work bestowed in this case will bring a less return than the 
work bestowed before. And the very fact that in the progress 
of society new land is brought into cultivation, proves that 
additional work cannot be bestowed with the same advantage 
as before on the old land. For 100 acres of the rich land 
will, of course, yield a larger return to the work of 10 men, 
than 100 acres of inferior land will do, and if this same rich 
land would continue to yield the same proportionate return 
to the work of 20 and 30 and 100 as it did to that of 10 labour- 
ers, the inferior land would never be cultivated at all. That 
this diminution of the return of the soil to the additional 
expense bestowed on it takes place gradnnMy, may also be 
proved by the same reasoning. 

The gradations of the quality of the soil must be infinite. 
Suppose any country to contain one million acres of land, 

* Many various circumstances, arising chiefly from the artificial 
regulations of society, will doubtless interfere to disturb this nat- 
ural progress of things; but though they may disturb the oper- 
ation of the principle, a very little consideration will show that 
they cannot completely counteract it; and that even these dis- 
turbances very often compensate each other. 



The Application of Capital to Land 15 

which return 30 per cent, net profit to a certain capital, sa}"" 
ten million bestowed on it; another million acres which re- 
turns but 19 per cent, or suppose a farm containing 10 acres, 
which return 20 per cent, net profit to lOOZ. bestowed on it, || n 
10 acres which return 19 per cent, to the same capital, and 
so on, as in the following table. 

Acres. Capital. Net Profit. 

10 100 20 

10 100 19 

10 100 18 

10 100 17, &c. 

The 10 acres returning 20 per cent, would be first culti- 
vated, and we have proved that the same 10 acres would not 
return 20 per cent, on each successive lOOZ. bestowed on it; 
for if it did, as I have sheAvn, no part of the other land would 
ever be cultivated. But should the additional capital be- 
stowed on the first 10 acres produce less than 19 per cent, 
the capita] would not be bestowed on the first 10 acres but 
on the second 10 acres. Or, in short, generally, if the best 
land already in cultivation would not return so much to the 
additional capital as to the capital already bestowed on it, by 
any great diiference, such additional capital would not be 
expended on the best land, but on that next in quality to the 
best, and which, from the infinite number of gradations of 
the quality of the soil, must be removed at the least possible 
distance from the best. 

It appears, therefore, that in the progress of | improvement 13 
an equal quantity of work extracts from the soil a gradually 
diminishing return; and that, therefore, the whole quantity 
of work bestowed on land in the progress of improvement, 
extracts from the soil a gradually diminishing proportionate 
return. But the quantity of work which can be done by a 
given number of hands is increased in the progress of im- 
provement, by means of the subdivision of labour and machin- 
ery even in agriculture. Such increase then of the quantity 
of work which can be performed by the same number of 



16 SiK Bdwaed West 

hands in agriculture, may either more than compensate, or 
just compensate, or fall short of compensating the diminu- 
tion of the return of the same quantity of work. In the first 
of which cases labour in agriculture would become absolutely 
more productive; in the second would remain always equally 
productive; in the last would become absolutely less pro- 
ductive. Thus say in any given stage of improvement ten 
hands will perform the same quantity of work as twenty 
would have performed at any given anterior period. Now if 
this same quantity of work will extract from the soil in the 
later period more than half what it would have extracted in 
the earlier, the same number of hands will produce more in 

13 the latter than in the former || period ; and labour in agricul- 
ture will, of course, have become absolutely more productive: 
if the same quantity of work will extract just half in the 
latter period of what it did in the former, labour will be 
equally productive; if less than half it will have become 
absolutely less productive. Now that neither of the two first 
suppositions can be the fact will be clear from a moment's 
consideration. If either of them were the fact, as we know 
that labour becomes actually more productive in manufac- 
tures, the wealth and stock of the community in the progress 
of improvement and population would go on, not only in- 
creasing, but increasing in a rapidly accelerated ratio. The 
reproduction of the country would not only each year be 
larger in amount than in the preceding year, but the ratio of 
that reproduction to the capital would each year be greater. 
Population would double with more ease in such a country in 
twenty-five years than it does in America in the same period ; 
and an acre of land would, in a subsequent stage of improve- 
ment, more easily maintain a thousand, or any nimiber of 
labourers, however great, than it could one in a former stage. 

But let us, notwithstanding, suppose that the first of these 

14 three hypotheses were the || fact, namely, that labour in agri- 
culture becomes in the progress of improvement absolutely 
more productive; and let us consider more minutely what 
would be the immediate consequence of such a state of things, 



The Application of Capital to Laitd 17 

and as labour in manufactures we have already seen, becomes 
in the progress of improvement more productive, let us sup- 
pose the effective powers of labour in all employments, both 
in raising rude produce and in manufacturing it to be 
doubled. It is obvious that the profits of stock would, in this 
case, be doubled; even allowing the wages of labour to be 
doubled at the same time; for by the productive powers of 
labour being doubled the net produce of labour would be 
doubled as well as the gross produce. There would be just 
twice as much of every article both of rude produce and 
manufactures as before. And, though no article would ex- 
change for more of any other than, before, yet, as every 
person in the community would have twice as much of the 
particular article in which he might deal, his command over 
every article would be doubled. If there were only the same 
quantity of money in the country as before, things would fall 
to half their money price, and neither the money profits of 
stock nor the money wages of labour would at first be in- 
creased, I but by the favourable exchange, which such increased 15 
cheapness of commodities would produce, bullion would be 
imported till there were money enough to circulate the in- 
creased quantity of articles, and the wages of labour, and 
profits of stock, would then be increased in their money value 
as well as their real value. 

But next let us suppose a case in which the powers of 
labour remain equally productive in agriculture, having be- 
come doubly effective in manufactures. Every article of 
manufactures is now reduced one-half in price compared with 
rude produce, but bears the same ratio towards all the rest 
of manufactures as before, and consequently exchanges for 
neither more nor less of such manufactures than before. But 
every manufacturing capitalist having doubled the production 
of the particular article in which he deals, has double the 
command over all manufactures, and the same command 
over rude produce that he had before. His real profit is 
therefore increased. The agriculturist has also double the 
command of all manufactures that he had before, and the 



18 Sir Edward West 

same command of rude produce. The real profits therefore 
of all capital are increased, and this would be followed as 
before by an increase in the money profits. 

16 The same reasoning would apply of course || to the above 
cases, if the effective powers of labour were increased in any 
less degree than I have supposed, though the increase of profit 
would not of course be so great. The difference would be 
merely in degree, not in principle. It follows therefore that 
if the powers of labour in agriculture were either to advance 
or remain stationary, the profits of stock must constantly rise 
in the progress of improvement. 

But suppose thirdly, that the productive powers of labour 
decrease in agriculture, whilst they increase in manufactures ; 
and say the habits and wants of the society and the powers 
of labour are such, that half of the capital of the country is 
employed in agriculture and half in manufactures. 

And first suppose that whilst the powers of labour double 
in manufactures, those powers become less productive by half 
in agriculture: — the manufacturing capitalist would now 
have double the command that he had before over manufac- 
tures; but only half the command that he had before over 
rude produce : and therefore on the whole he would have no 
additional command over the aggregate of commodities, and 
his profit would remain the same as before. The same would 
be the case also with the agriculturist. If this supposition 

17 then were || the fact, the profits of stock would always con- 
tinue the same in the progress of improvement. 

And without tracing the same process again, it is evident 
that if the decrease of the powers of labour in agriculture 
should be greater than the increase of those powers in manu- 
factures, the profits of stock must diminish. But to consider 
the case of a diminution of the powers of labour in agricul- 
ture, accompanying an increase of those powers in manufac- 
tures in a different light : — Suppose that the habits and wants 
of the people of any country are such in any given state of 
the productive powers of labour, that half their capital is 
employed in agriculture and half in manufactures. Suppose 



The Application of Capital to Land 19 

then that in the progress of improvement the capital in manu- 
factures becomes more productive, the capital in agriculture 
less so. If the capital which can now be spared from manu- 
factures on account of the increase of the effective powers in 
them, will raise as much rude produce as to compensate for 
the diminution of the productive powers in agriculture, the 
profits of the stock of the society will remain the same as 
before. But if the spare manufacturing capital will not 
compensate the defective powers of production in agriculture, 
the profits of the stock of the society must diminish. But 
which of these conclusions is | really the fact ? Do the profits is 
of stock increase, remain stationary, or decrease in the 
progress of improvement? 

It is an acknowledged fact that the profits of stock are 
always lower in a rich than in a poor country ; and that they 
gradually fall as a nation becomes more wealthy. This is 
evidenced as well by our own history as by that of every other 
country, in which the state and progress of commercial capi- 
tal have been observed. — (See Wealth of Nations, Book I. 
c. 9.) It follows therefore that labour cannot be always 
equally productive in agriculture in the progress of improve- 
ment; and, a fortiori, that the productive powers of labour 
cannot increase, but that they must become gradually less 
productive in the progress of improvement. And not only 
less productive, but so much less productive that the con- 
tinual increase of the effective powers of labour in manufac- 
tures does not compensate for their continued diminution in 
agriculture. For if it were not so, the profits of stock would, 
as I have just proved, become continually higher in the 
progress of improvement. In the above argument I have 
supposed the wages of labour to vary with the productive 
powers of that labour ; that is, that the more labour produces 
the better it will be paid. That this is nearly the || case, I 19 
shall prove presently ; but it will be sufficient for the present 
to shew that it is impossible wholly to account for the pro- 
gressive diminution of the profits of stock by any increase of 
the wages of labour. And for this purpose I shall briefly 



20 Sir Edward West 

recapitulate the above argument. It is a known fact, as I 
have stated, that the profits of stock diminish in the progress 
of wealth and improvement, but the profits of stock are the 
net reproduction of stock, which can be diminished in two 
ways only, namely, either by a diminution of the powers of 
production, or by an increase of the expense of maintaining 
those powers, that is, by an increase of the real wages of 
labour. That the real wages of labour cannot increase so as to 
account for this diminution of the net reproduction, is clear 
from this, that if it were so, the real wages of labour would be 
constantly and greatly increasing in the progress of wealth and 
improvement; and population would consequently increase 
more and more rapidly in the progress of improvement, the 
contrary of which we know to be the fact. 

As therefore the diminution of the net reproduction is not 
wholly, at least, caused by the increasing wages of labour, 
that is, the expence of maintaining the productive powers ; it 
20 must be caused partly, at least, by a dimi- || nution of those 
powers. But the productive powers in manufactures, as has 
been shewn, are constantly increasing, and the diminution of 
the net reproduction or the profits of stock must therefore 
necessarily be caused by a diminution of the productive pow- 
ers in agriculture. But though it appears to me to be self- 
evident that the profits of stock or the net reproduction of 
stock cannot be diminished by any other means than the two 
I have mentioned, namely, an increased expence of maintain- 
ing the productive powers, and a diminution of those powers, 
yet it may be right to notice that Dr. Smith has attributed 
the fact of the gradual diminution of the profits of stock to 
a very different cause. 

" The increase," says Dr. Smith, " of stock which raises 
wages tends to lower profit. When the stocks of many rich 
merchants are turned into the same trade, their mutual com- 
petition naturally tends to lower its profit, and when there is 
a like increase of stock in all the different trades carried on 
in the same society, the same competition must produce the 
same effect in them all." Book I. c. viii." p. 133. 



The Application of Capital to Land 31 

Smith therefore attributes this decline in the rate of profit 
to increased competition. But the slightest consideration 
will detect the fallacy of this opinion. If the capital em- 
ployed II in one branch of trade alone be increased, doubtless 31 
the increased competition of the dealers in that branch will 
lower the price of their articles, and consequently the profits 
of those dealers. But why is the price lowered except because 
that article is now more abundant than others, and could not 
be sold without such diminution of price. But if the capital 
in all the different branches of trade, and consequently the 
quantity of all the articles of those respective trades be in- 
creased in the same degree, the same ratio between each and 
all the rest remains, and each article must sell for the same 
real price as it fetched before. If the competition be in- 
creased in any one article, it for the same reason is increased 
in all; and as it exists in the same degree in each, it cannot 
alter the real price of any one. It is only the relative altera- 
tion of the demand and supply which can increase the price, 
and here there is no such alteration. 

The money price of all articles would no doubt be dimin- 
ished, and therefore the money-profits of stock; but this 
would not lower the real price of those articles, nor the real 
profits ; even the money price would soon be raised to a level 
with the real price, by a favourable balance of trade and the 
consequent introduction of bullion. Still, however, it may 
be said as || before, that such competition may lower the profits 22 
by an increased demand for workmen, and a consequent rise 
of wages. 

We return then to the old question, whether the diminution 
of the profits of stock in the progress of improvement can be 
caused by the increase of the wages of labour. Now, 1st, If 
such were the fact, how comes it that both the wages of labour 
and profits of stock are high at the same moment in America. 
The wages of labour being higher in America than in this 
country, if the rise of the wages of labour were the only rea- 
son of the diminution of the profits of stock, the profits of 



22 Sir Edward West 

stock in America should be lower than they are here. But 
we know that they are much higher. 

To enter a little more particularly into the subject of the 
wages of labour, they, like the price of every thing else, must 
depend on the supply and demand. The supply of course 
depends on the amount of the population; the demand de- 
pends, as Dr. Smith states, on the amount of the stock of the 

23 country.* If then || the stock increase faster than the popu- 
lation, the demand increases faster than the supply, and 
wages must rise ; if the stock and population increase equally, 
wages will remain stationary; and if population increase 
more rapidly than the stock, wages must fall. 

It is not the amount then of the stock of a country which 
causes high wages ;f* for if the stock of a country be station- 
ary, whatever be its amount, population will soon increase up 
to the most scanty subsistence which such stock can afford. 
Other circumstances beside the amount of stock may, no 
doubt, influence the wages of labour; but I am now consider- 
ing merely what effect the quantity of stock may have on the 
wages of labour; and other circumstances must of course be 
excluded from consideration, or taken in mathematical lan- 
guage to be given. 

Nor is it the greatness of the increase alone of stock which 
causes high wages, but it is the greatness of the ratio of the 
increase. 

Thus suppose a country with 100 millions increasing its 
stock annually to the amount of a million, the increase would 
be as 1 to 100 ; and the increase of the wages of labour would 

24 be but i-J-j. II 

* The demand of those who live by wages necessarily increases 
with the increase of the revenue and stock of every country, and 
cannot possibly increase without it. The increase of revenue and 
stock is the increase of national wealth. The demand for those 
who live by wages therefore naturally increases with the in- 
crease of national wealth, and cannot possibly increase without 
it. B. 1. c. 8. 

fW. of Nations, B. 1. c. 8. 



The Application of Capital to Land 23 

But suppose a country with stock amounting to 10 millions, 
and an annual increase of half a million, though the actual 
increase of stock would be smaller than in the last case, the 
increase in the wages of labour would be a half -tenth or one- 
twentieth. But it must be observed, that supposing a coun- 
try to be always equally parsimonious, it is upon the rate of 
profit that the rate of the increase of its stock depends: for 
the profits of stock are, as I have before mentioned, the net 
reproduction of stock, and the greater therefore the profits 
of stock, if the country be equally parsimonious, the greater 
the rate of the increase of stock. 

And it follows that in such a country the greater the profits 
of stock, the higher will be the wages of labour, and vice versa. 
That the demand for labour would be greatest when most 
could be made of it, that is, when the profits of stock were high, 
and least when those profits were low, appears too plain to 
have required proving, and I should not have dwelt on this 
subject had not Dr. Smith, in spite of his clear statement of 
the subject of wages in the 8th chapter, seemed to maintain 
an opposite opinion. "The rise and fall in the profits of 
stock," says Dr. Smith, " depend on the same causes with the 
rise and fall in the wages of labour, the increasing or |1 de- 25 
dining state of the wealth of the society, but those causes 
effect the one and the other very differently. The increase of 
stock which raises wages tends to lower profit."— Book I. 
c. 9. p. 133. Dr. Smith seems therefore, here to think that 
the profits of stock and wages of labour vary inversely as each 
other, the contrary of which I think I have proved to be the 
fact. 

I will now recapitulate shortly the whole of the above argu- 
ments. 

The division of labour and application of machinery render 
labour more and more productive in manufactures, in the 
progress of improvement; the same causes tend also to make 
labour more and more productive in agriculture in the pro- 
gress of improvement. But another cause, namely, the neces- 
sity of having recourse to land inferior to that already in 



24 Sir Edward West 

tillage, or of cultivating the same land more expensively, 
tends to make labour in agriculture less productive in the 
progress of improvement. And the latter cause more than 
counteracts the effects of machinery and the division of labour 
in agriculture; because, otherwise agricultural labour would 
either become more productive, or remain equally productive, 
in the progress of improvement. 

26 In either of which cases, since labour in 1| manufactures 
becomes more productive, all labour would become more pro- 
ductive, and the profits of stock, which are the net reproduc- 
tion, would, of course, rise in the progress of improvement. 
But the profits of stock are known to fall in the progress of 
improvement, and, therefore, neither of the two first suppo- 
sitions is the fact, and labour in agriculture must, in the 
progress of improvement, become actually less productive. It 
is then shewn that this effect cannot be produced by a rise in 
the real wages of labour. 

The powers of labour therefore, in agriculture, becoming 
less productive, and the diminished expense of maintaining 
those powers not compensating such decreased productiveness, 
which appears from the progressive fall of the profits of stock, 
the whole produce of land, and consequently the net produce, 
must diminish in proportion to the expense of production; 
and the ratio of the net produce to the gross must diminish 
in the progress of improvement. 

I have endeavoured, therefore, to prove the principle which 
it was my object to prove theoretically, and to account for it 
as I proceeded in the proof. But I need not this reasoning 
for the purpose of substantiating the fact, that the ratio of 

37 the net produce to the || gross produce of land gradually 
diminishes in the progress of improvement. 

Smith has stated, and certainly correctly, that the natural 
rent of land is always that part of the net produce of land 
which remains after payment of the common profits of stock 
on the tenant's capital. — Book I. c. 11. p. 233. 

If then the ratio of the rent of land to the tenant's capital 
be gradually diminishing in the progress of improvement, the 



The Application of Capital to Land 25 

profits of stock remaining the same, the ratio of the net pro- 
duce to the capital, and consequently to the gross produce of 
land, must also be gradually diminishing in the progress of 
improvement. A fortiori must this follow, if, as it has been 
stated, the profits of stock also gradually diminish in the 
progress of improvement. 

Now it is a commonly observed fact, and one which appears 
in almost every page of the Eeports of the corn committees, 
that the ratio of the rent to the gross produce is much less 
at the present moment in this country than it was twenty 
years ago, that where twenty years ago rent was one-third of 
the gross produce, it is now one-fifth, or between one-fourth 
and one-fifth. This, it may be said, is attributable to the 
increased burthens on the land, to the poor rates and taxes. 
It is certainly possible || that this may have had some effect 28 
in producing this alteration of ratio between the rent and 
gross produce. However be this as it may, the witnesses who 
speak to this fact of the ratio of the rent to the gross produce 
having declined, attribute it expressly to the more expensive 
mode of cultivation now adopted in order to increase the 
produce, and not to the taxes or rates. Thus in p. 41, of the 
Lords^ Eeport, the witness says, that, " where estates are in a 
very high cultivation, the share of the gross produce obtained 
as rent by the landlord is less than where estates are more 
imperfectly cultivated.'^ And this is the language of *all 
the witnesses before the corn committees; they are unani- 
mous in their opinion that where lands are in a high state of 
cultivation the rent bears a less ratio to the gross produce 
than where they are less expensively tilled. 

Dr. Smith seems in one passage to have been aware of this 
fact of the diminution of the ratio of the rent to the gross 
produce in the progress of improvement. 

"In the present state of Europe,'' says he, "the share of 

* See p. 41. 57. 63. 94. 103. 130 of the Lords' Reports.— In p. 44. 
79. 92. 99. 111. 121. 133. 154. 203 of the Commons' Reports, A. D. 
1814.= 



26 Sir Edward West 

29 the landlord seldom exceeds a || third, sometimes not a 
fourth part of the whole produce of the land. The rent of 
land, however, in all the improved parts of the country has 
been tripled and quadrupled since those ancient times, and 
this third or fourth part of the annual produce is, it seems, 
three or four times greater than the whole had been before. 
In the progress of improvement, rent, though it increases 
in proportion to the extent, diminishes in proportion to the 
produce of the land." (See Smith, vol. ii. p. 8. b. 2. c. 3.) 

It is singular that after this distinct enunciation of the 
fact of the diminution of the rent in proportion to the gross 
produce, that the author of the Wealth of Nations should 
not only not have seen the conclusion to which this leads by 
a mere arithmetical operation, viz. that of the diminution of 
the net produce of land to the gross produce, but that in 
other parts of his work he should even lose sight of this fact 
of the diminution of the ratio of the rent to the gross produce 
of land. " The extension of improvement and cultivation," 
says Dr. Smith in one passage, " tends to raise rent directly. 
The landlord's share of the produce necessarily increases 
with the increase of the produce. That rise in the real price 

30 of those parts of the rude produce of land, which is || first 
the effect of extended improvement and cultivation, and 
afterwards the cause of their being still further extended; 
the rise in the price of cattle, for example, tends too to raise 
the rent of land directly, and in a still greater proportion. 
The real value of the landlord's share, his real command of 
the labour of other people, not only rises with the real value 
of the produce, but the proportion of his share to the whole 
produce rises with it." (Smith, vol. i. p. 392. b. 1. c. 11.) 

And the 11th chapter of the first book abounds with pas- 
sages in which the fact that the ratio of the rent of land to 
the gross produce diminishes in the progress of improvement, 
is overlooked. 

I have, therefore, attempted to prove as well theoretically 
as by the evidence of practical men, that the ratio of the net 
produce of land to its gross produce diminishes in the progress 



The Application of Capital to Land 27 

of improvement. I could adduce a variety of facts in cor- 
roboration of my proof had I leisure to go into them. There 
is one. however, which seems to me so unequivocal a test of 
my principle, that I shall just mention without entering into 
the discussion of it. It is the progressive rise of the value of 
tithes as compared with rent. 



31 



I shall now apply this principle to a consideration of the 
question of the policy of restricting, or totally prohibiting, in 
the present circumstances of this country, the importation of 
foreign corn; and shall first briefly sketch some of the con- 
sequences of such restriction or total prohibition, and then 
point out a few of the probable effects of a free importation. 
One of the consequences of a total prohibition of importation 
would be that the average price of corn would presently rise 
to its growing, or natural price, supposing corn to be now 
below that price, and afterwards the average price would 
progressively increase, and the nearer any restriction ap- 
proaches to prohibition, the more nearly will the effect of 
such restriction resemble that of a total prohibition. Take 
90s. the quarter to be the growing price in this country of a 
crop of wheat sufficient for our present population, if impor- 
tation were totally prohibited the average price of wheat 
would presently rise to 90s. the quarter. So if by any system 
of regulations the importation of foreign wheat were directly 
or virtually prohibited, till wheat in our own market had 
reached the price of 80s. the quarter, the average price of 
wheat would presently rise to 80s. ; and 80s. would be the 
minimum of price at which wheat could be sold in our mar- 
ket, for any continuance. || 32 

The following reasons induce me to think that 90s. the 
quarter may be about the growing price of a crop of wheat 
raised at home, sufficient for our present supply. It appears 
from the documents given in the reports of the corn commit- 
tees, that in the years 1811 and 1813 our home growth was 
about adequate to our consumption. 



28 SiK Edward West 

According to Sir H. Parnell's statement, which I have 
compared with these documents, and believe to be accurate, 
" the value of corn exported in 1811 from the united king- 
dom to foreign countries, was 1,379,714/. — The value of for- 
eign corn imported was 1,092,804Z. leaving a balance of ex- 
ported corn of 286,910Z. In 1813 the value of corn exported 
from the united kingdom to foreign countries was 1,498,229Z. : 
the value of foreign corn imported was 1,213,850Z. leaving a 
balance of exported corn of 284,379Z. In consequence of the 
fire at the Custom-House the value of corn exported from 
Great Britain in 1813 to foreign countries cannot be ascer- 
tained." * In the years 1811 and 1812, therefore, we grew 
rather more corn than sufficient for our own supply; but 
when it is considered that from Ireland alone, grain to the 
33 value of 598,325Z. in 1811, and to the |1 value of 662,823Z. in 
1812, was exported to Spain and Portugal, a great portion 
of which was of course for the maintenance of our own troops, 
who must now be fed at home, it will be fair, perhaps, to con- 
sider that in those years we about supported our population. 

It appears from the same documents that the actual price 
of wheat in the year 1811 was 94s. Qd. the quarter; in 1812, 
125s. 5(Z.t 

The actual price is not of course a sure criterion of the 
growing price, unless it be taken on an average of some 
length. But considering that the price of wheat in this 
country was in 

s. d. 

1810 - - 106 the quarter. 

1811 - - 94 6 

1812 - - 125 5 
and in 1813 - - 120 

though we make every allowance for the extension of the 
present improved system of husbandry into Ireland, and 

* P. 12 of Sir H. Parnell's pamphlet.^ 

t See 1st Commons Reports, App. No. 1, p. 28. The Windsor 
prices of the four first years are higher than those above stated. 



The Application of Capital to Land 29 

those parts of this country into which it has not yet penetrated, 
it is impossible to take the growing price of a crop of wheat 
sufficient for our own supply at less than 90s. the quarter, in 
the present state || of the currency. And of course it cannot 34 
fall permanently below its growing price, for otherwise it 
would not remunerate the grower, and the same quantity 
would not continue to be produced. But to make provision 
for an increasing population, it will be necessary to increase 
the produce, and this increased produce will, as I have shown, 
be raised at a greater proportionate expense; or in other 
words, the growing price will progressively increase. Such 
would be the consequence of a total prohibition of importa- 
tion; and the same reasoning proves that if the importation 
of foreign wheat were permitted only whilst our own wheat 
were above for instance 80s. the quarter, the average price 
of wheat in our markets would never fall below 80s. the quar- 
ter. For it is the competition of the foreigner alone which 
could keep down wheat even to 80s. and when that compe- 
tition were withdrawn, as it must be as soon as the price fell 
below 80s. our price would again rise as far as that compe- 
tition would permit, viz. to 80s. the quarter. 

But it has been denied that the price of com would rise 
were importation prohibited. 

Sir Henry Parnell (in p. 12 of his pamphlet) says, "the 
effect of the war, but more particularly of the Berlin and 
Milan Decrees, and of our own Orders in Council, has been 
to im- II pose such restrictions on the importation of foreign 35 
corn during the last five years, as had the direct operation of 
an act of parliament imposing very high duties on that trade, 
by giving the British farmer the full benefit of nearly the 
whole demand of the British market. In the first place a 
very high price; in the next place a very great increased 
production of corn ; and in the last place a very great fall in 
the price of it." 

And from this he argues (p. 43) "that in the next year, 
as the farmer will have the full benefit of the whole of the 
demand for our consumption, he will probably grow as much 



30 Sir Edward West 

as he has grown of late years; and, therefore, if the crop is 
a good one, the price will keep as low as it now is. In the 
following years, the certainty of a steady market will lead 
to a superfluous supply, and then the price will still be lower. 
It will thus become gradually lower and lower until it shall 
he on a level with the rest of Europe; and that we shall be 
able to secure permanently a superfluous growth of corn, by 
being able to export it, and sell it as cheap as foreign corn 
can be sold in the foreign market." 

Now I deny that there has been any fall in the price of 

36 corn, as stated by Sir H. Parnell. || 

s. d. per Qr. 
In 1808 the average price of wheat was 79 ") 

1809 95 7 1 . XT -, , o 

1810 106 2 I App No. 1 of Com- 

,Qj^ Qd 6 I °^o^3 Isi' Report, p. 38. 

1812 ". ! ! ! 125 5 J 

f Windsor prices, App. 

In 1813 120 J of Lords Rep. No. 12, 

[ p. 327. 

How this can be called a fall in price, much less a very 
great fall, I am at a loss to conceive, even allowing for any 
possible additional depreciation of our currency. 

It is true that Sir H. Parnell states, " that the price of 
wheat (p. 42) for the average of the twelve maritime dis- 
tricts of England and Wales the week ending the 21st of 
May, 1814, was 67s. lid. If this price is in any degree a 
price that has been regulated by the importation of foreign 
wheat, to that degree the bill for restraining importation 
would advance it. But this price is a price settled by the 
quantity of our own wheat in the market, and on hand in the 
country; and therefore, the bill cannot advance it. The fact 
is, the abundance of our own corn alone has brought down 
the price to its present level ; and this is so great, that there 
is every reason to suppose that it will fall still lower, even if 

37 the bill shall become a law." || 

Now how can it possibly be proved or known for a fact, 
that the abundance of our own corn alone has brought down 
the price to the level mentioned by Sir H. Parnell ? 



The Application of Capital to Land 31 

On the contrary is it not notorious that the expectations 
of importation, if not actual importation, had at that time 
considerably reduced the price of wheat? 

The witness in p. 26 of the last Commons Eep. thus 
answers questions put to him. 

Question. — " Do you not conceive that the present low 
price of grain is wholly occasioned by the abundant crop of 
last harvest, and not in consequence of any expectation of 
foreign import ? " — " Certainly not ; it is the alarm of the 
importation from abroad." 

"Are you aware of any large importation of foreign corn T' 
— " There is an expectation of it." 

"Are you aware whether any foreign corn has been im- 
ported ? " — " No ; I do not allude to any particular quantity 
lately imported; but the farmers are very much alarmed, and 
of course bring every bushel to market." 

With respect to Sir H. Parnell's opinion that corn will 
become lower and lower, it is good for nothing, unless he 
can show that the expenses of cultivation will fall, as of 
course the | actual price cannot permanently fall unless the 38 
growing or natural price fall. 

That rude produce does rise in price in the progress of im- 
provement, experience as well as theory demonstrates. That 
this rise too in the price of rude produce is followed by a 
rise in the wages of labour, and communicates itself, more 
or less to all manufactures, chiefly of course to those in which 
rude produce predominates most, and in a less degree to 
those manufactures of a finer kind in which rude produce 
bears but a small proportion to the skill of the artist, is also 
evident. 1st, Looking to our own country, com has been 
constantly rising in price since the middle of the last cen- 
tury. This phenomenon of the rise in the price of corn has 
been constantly observed in all improving countries. 2dly, 
England in an early stage of improvement exported com in 
exchange for manufactures, as Poland and America do at the 
present moment. Our wealth and population increased, and 
as far as the circumstances of Europe and our own laws per- 



32 Sir Edwaed West 

mitted, we imported corn in exchange for our manufactures; 
so did Holland and Genoa in the time of their wealth. Such 
is the course in which improving nations seem destined to 
move. They begin by exporting rude produce for manufac- 

39 tures ; as they grow more wealthy |1 they export less com, 
and fabricate more manufactures at home ; in a further stage 
they export manufactures only, and receive rude produce in 
return from nations less advanced than themselves, and 
these manufactures gradually change in kind, containing less 
and less of rude material, and more and more of manufac- 
turing skill. The price of every thing increases rapidly, and 
the profits of stock fall so low, as I have shown they must do, 
from the enhanced price of rude produce, that at last even 
the capital of the merchant, and next of the manufacturer, 
seeks a more grateful soil. 

It is not a little singular that this rise of the real price of 
corn in the progress of improvement has escaped the atten- 
tion of the author of the Wealth of Nations, though he ex- 
pressly states, "that all other sorts of rude produce, except 
com and such other vegetables as are raised altogether by 
human industry, naturally grow dearer as the society advances 
in wealth and improvement.^" B. 1. c. 11. p. 339. In an- 
other passage he says, "In every state of society, in every 
stage of improvement, corn is the production of human in- 
dustry. But the average product of every sort of industry is 
always suited more or less exactly to the average consump- 
tion: the average supply to the average demand. In every 

40 different stage of im- | provement, besides, the raising of 
equal quantities of corn in the same soil and climate, will, at 
an average, require nearly equal quantities of labour; or, 
what comes to the same thing, the price of nearly equal quan- 
tities; the continual increase of the productive powers of 
labour in an improved state of cultivation, being more or 
less counterbalanced by the continual increasing price of 
cattle, the principal instruments of agriculture. Upon all 
these accounts, therefore, we may rest assured, that equal 
quantities of corn will, in every state of society, in every stage 



The Application of Capital to Land 33 

of improvement, more nearly represent, or be equivalent to, 
equal quantities of labour, than equal quantities of any other 
part of the rude produce of land." B. 1. c. 11. p. 293. and see 
B. 1. c. 11. p. 382. 

Dr. Smith takes notice of what he seems to think a vulgar 
error, that the price of corn is always lower in a poor coun- 
try than in a rich. 

"The greater part of the writers who have collected the 
money prices of things in ancient times, seem to have consid- 
ered the low money price of corn, and of goods in general, or, 
in other words, the high value of gold and silver, as a proof, 
not only of the scarcity of those metals, but of the poverty 
and barbarism of the country at the time when it took 
place, &c." B. 1. c. 11. p. 375. But in this same passage j] 41 
he allows that the low money price of cattle, poultry, &c. is 
a proof of the poverty of a country. Mr. Hume takes notice 
of the fact of the increase of the price of provisions and 
labour, in an improving country, and assigns a very insuffi- 
cient reason for it, viz. the increase of the quantity of money. 

" There seems to be a happy concurrence of causes in hu- 
man aifairs, which check the growth of trade and riches, and 
hinder them from being confined intirely to one people, as 
might naturally at first be dreaded from the advantages of 
an established commerce. — Where one nation has got the start 
of another in trade, 'tis very difficult for the latter to regain 
the ground it has lost, because of the superior industry and 
skill of the former, and the greater stocks of which its mer- 
chants are possessed, and which enable them to trade for so 
much smaller profits. But these advantages are compen- 
sated, in some measure, by the low price of labour in every 
nation which has not an extensive commerce, and does not 
very much abound in gold and silver. Manufactures, there- 
fore, gradually shift their places, leaving those countries and 
provinces which they have already enriched, and flying to 
others, whither they are allured by the cheapness of pro- 
visions and labour, till they have |] enriched these also, and 43 
are again banished by the same causes. And, in general, we 



34 Sir Edward West 

may observe, that the dearness of every thing, from plenty 
of money, is a disadvantage which attends an established 
commerce, and sets bounds to it in every country, by enabling 
the poorer states to undersell the richer in all foreign mar- 
kets." (Hume, vol. 1. Part 2. Essay 3. pp. 312 and 313.)' 

The only means of retarding this necessary progress of 
things is by importing rude produce from countries where 
we can buy it cheaper than we can grow it at home. 

By such means we might, to a very great degree, unite the 
advantages of a fresh country, and of one highly improved. 
By these means we might purchase our rude produce cheap, 
and manufacture it cheap; but if we refuse to import our 
rude produce, we must daily approximate to that state which 
Hume has so strongly described. Great question has been 
made of the truth of the fact, which is noticed by Dr. Smith, 
that any rise in the price of corn communicates itself to every 
other commodity. It is immaterial here to enter into the 
question whether Dr. Smith meant real or nominal price. 
The rise in the real price of any thing which immediately 
43 and fully communicates itself to every other article || seems, 
indeed, a contradiction in terms; because the real price of 
any article is its value in exchange for every other: but if 
the rise in price of any one be immediately and fully com- 
municated to every other, the rise is merely nominal, as that 
article can now purchase no more of any other article than 
before. It is sufficient for my present purpose, if it be true, 
that by any increase of expense in obtaining rude produce 
the whole wealth and comfort of the community is dimin- 
ished, the command of each individual over all the neces- 
saries and luxuries, both domestic and foreign, lessened.* 
That such must be the consequence of the increasing expense 

* If all the commodities in a society, except money, were di- 
minished in equal proportion, the real price, i. e. their value in 
exchange for each other would remain the same. If the money 
were diminished in the same proportion, their nominal price 
would also remain the same, yet in each case it is obvious that 
a large portion of wealth would be lost to the society. 



The Application or Capital to Land 35 

of raising rude produce is obvious to the slightest considera- 
tion. The larger the capital required to raise the rude pro- 
duce of a country, the less in proportion can, of course, be 
spared for its manufactures, 

" Throughout the whole world the number of manufac- 
tures, of proprietors, and of persons 1| engaged in the various 44 
civil and military professions must be exactly proportioned 
to the surplus or net produce of the earth, and cannot in the 
nature of things increase beyond it. If the earth had been 
so niggardly of her produce as to oblige all her inhabitants 
to labour for it, no manufacturers or idle persons could ever 
have existed." Malthus, b. 3. c. 8. p. 309." Suppose a coun- 
try insulated from all others and containing one million in- 
habitants, the soil of which is such that half the number are 
suflScient to raise food for the whole; and suppose the other 
half to be employed in fabricating manufactures for them- 
selves and for the agricultural labourers. Suppose now that 
this million of inhabitants increases to two million; if from 
the increased difficulty of raising food for the two million 
inhabitants it becomes necessary to employ two-thirds of 
them in providing subsistence for the whole, there is now 
but one-third of the whole left to administer to the other 
wants of the society, and if the efEective powers of labour in 
manufactures be not increased, and that in a degree sufficient 
to compensate for the greater proportion of the labour of the 
whole community which is now required for agriculture, the 
revenue and comforts of the whole community must be 
diminished. But suppose now this country to || open a com- 45 
munication with a neighbouring country which had not car- 
ried its skill in manufactures so far, but grew its corn much 
cheaper, so that the former, by turning a part of her hands 
from agriculture to manufactures, could make as many man- 
ufactures as would purchase twice as much corn from the 
new country as those hands had before raised. The conse- 
quence would, of course be, that the former country could 
draw another portion of her hands from agriculture to man- 



36 Sir Edward West 

ufacture for herself, and the real wealth of the whole com- 
munity would be increased. 

I come now to the consideration of some of the conse- 
quences of a free importation of foreign corn; and, first I 
shall consider its effects upon our own agriculture ; and I will 
assume that the growing price of foreign wheat is such that 
it can be imported into this country and sold in our markets 
at a price as low even as 45s. the quarter, in the present state 
of the currency. Taking, as I have before done, the present 
growing price of our wheat to be 905. the quarter, it would 
appear to be impossible for our farmers to bear this unequal 
competition. 

It would appear to cursory observation that the whole of 
our agriculture would, in time, be superseded. And such 
46 would inevitably be || the case if our expenses of cultivation 
should not diminish as our growth diminished, nor the ex- 
penses of foreign growth increase as their produce increased. 
The constant difference of 45s. the quarter would necessarily 
induce the foreigner to increase his growth, and compel the 
home grower to diminish his, till the former had completely 
expelled the latter from the market. 

But there are limits to this dependance of any country on 
foreigners for an article of the first necessity; and these 
limits are to be foimd in the principle which I have stated. 
That principle will shew that in such case, as the growth of 
the foreigner increased the proportionate expense of his 
growth would increase,* and as the home growth was dimin- 
ished, the proportionate expense of the home growth would 
also be diminished, since a larger growth is raised in any 
given country, at a larger proportionate expense than a 
smaller growth. Say that the first year of importation we 
import half a million quarters; the next year the foreign 

* It is indifferent for the present purpose whether this increase 
of the price of the foreign supply would proceed, as it partly 
would, from an increased expense of growth, or as it would also 
partly from the necessity of drawing it from more distant regions. 



The Application of Capital to Land 37 

grower, in order to meet the || increased demand for foreign 47 
corn, will increase his growth, say half a million quarters, 
and the foreign growing price will rise, say from 45 to 50s. 
the quarter. The home grower will diminish his growth 
half a million quarters, and the home growing price will fall, 
say from 90 to 80s. the quarter. The actual price of both 
in the market must meet and be at some point between 50 
and 80s. say at 65s. This price is still such as to induce the 
foreigner to increase his cultivation, and the home grower to 
diminish his. In consequence the foreigner's growing price 
will be still further increased, and the home grower's still 
more diminished, say to 60s. the quarter, and say that the 
actual price in our market falls to 60s. Both the home 
grower and the foreigner are now just paid the natural price 
of their produce, and there is no longer any motive to the 
one to increase his cultivation, nor to the other to diminish 
his. I have not pretended here to approximate to the de- 
grees in which the prices would rise and fall, nor to the point 
at which the growing prices of home wheat and foreign wheat 
would meet. The process would be slower, and therefore 
less violent than I have supposed. All I mean to assert is, 
that the growing price of the former would fall, and the 
growing price of the latter rise, till they met || at some point 48 
between the original prices of each. This point Avould, of 
course, be much nearer the present growing price of the for- 
eign than of the domestic growth, as the efEect of the impor- 
tation divided among many foreign markets would be less to 
each than the effect of the importation operating on our 
single market. It is remarkable how differently the circum- 
stance of a similar disparity of price would affect manufac- 
tures. Suppose the foreigner could manufacture broad cloth 
and sell it in our market at half the price at which we could 
afford to sell it; the home manufacturer, as in agriculture, 
would immediately diminish his manufacture, the foreigner 
would increase his; but the more the home manufacturer 
diminished his manufacture, the greater would be the pro- 
portionate expense or natural price of it; the more the for- 



38 Sir Edward West 

eigner increased his, the less would be the natural price of 
his manufacture, upon the principle that the larger the con- 
cern in any manufacture the further can the subdivision of 
labour and application of machiner}' be carried. — See W. of 
N. B. 1. c. 3. 

Next I shall consider the effects of a free importation of 
corn upon rents. Supposing the proportionate expenses of 

49 raising rude produce to remain the same, whatever were the || 
amount of that produce; there would be ground indeed for 
the alarm of landlords. For it would appear, as has been 
frequently stated, that in such case the farmer could not 
afford to pay any rent at all. Thus suppose 100 acres of 
land tilled for wheat let at a calculation of the price of wheat 
at 905. the quarter; and suppose the capital laid out on such 
land to amount to lOOOZ., take the rent at 3001. a-year, the 
profits of the capital must be 10 per cent. i. e. lOOZ. a-year. 
The whole produce of this land must therefore be 1400Z. 
Suppose now wheat to fall, as it has fallen, one-third, i. e. to 
60s. the quarter. The produce of the land would now be 
only two-thirds of 1400Z. that is about 932Z. and it is obvious 
that the farmer, so far from being able to pay any rent, would 
not even reproduce his capital laid out, and no diminution of 
his capital would give him any profit, but would merely 
diminish his loss. 

But our principle will shew that by a diminution of the 
capital laid out by the farmer, he will be enabled both to re- 
produce his capital with the common profits of stock on that 
capital, and also a rent not very much, perhaps, below that 
which he paid before. 

It is the diminishing rate of return upon additional por- 

50 tions of capital bestowed upon || land that regulates, and 
almost solely causes, rent. 

If capital might be expended indefinitely with the same 
advantage upon land, the produce would, of course, be un- 
limited ; and this would have the same effect upon rent as an 
unlimited quantity of land convenient for cultivation. In 
either case the rent would be very small. But it is the neces- 



The AppLiCATioisr or Capital to Land 39 

sity of having recourse to inferior land, and of bestowing 
capital with diminished advantage on land already in tillage 
which increases rent. Thus, if in ease of any increased de- 
mand for corn, capital could be laid out to the same advan- 
tage as before, the growing price of the increased quantity 
would be the same as before, and competition would, of 
course, soon reduce the actual price to the growing price, and 
there could be no increase of rent. But on any increased de- 
mand for corn, the capital I have shewn which is laid out to 
meet this increased demand is laid out to less advantage. 
The growing price, therefore, of the additional quantity 
wanted is increased, and the actual price of that quantity 
must also be increased. But the corn that is raised at the 
least expense will, of course, sell for the same price as that 
raised at the greatest, and consequently the price of all corn 
is raised || by the increased demand. But the farmer gets 5i 
only the common profits of stock on his growth, which is 
afforded even on that corn which is raised at the greatest ex- 
pense ; all the additional profit, therefore, on that part of the 
produce which is raised at a less expense, goes to the landlord 
in the shape of rent. 

Thus suppose 10 acres of land which will return 20 per 
cent, on a given capital, say 100?. ; 10 acres which will return 
19 per cent, and so on, as in the following table. 
Acres. Capital. Net Produce. 

10 100 20 

10 100 19 

10 100 18, &c. 

10 100 11 

10 100 10 

Supposing the profits of stock to be 10 per cent, the last 
ten acres could not be taken at any rent for the purpose of 
cultivation, but might be cultivated by the owner of the land, 
or might afford a rent if left as pasture. The 10 acres 
which afford 11 per cent, would, after paying the profits on 
the tenant's capital, pay one per cent, as rent, and as the 



40 SiK Edwaed "West 

corn which was raised on the 10 best acres would sell for 
the same price as that raised on the 10 worst, such land 

52 would pay to the landlord 101. as || rent, the next 10 acres 9?., 
and so on. Suppose now the price of corn to rise, and the 
profit on the last 10 acres to be increased in consequence from 
10?. to 111. it is evident that the ten acres which before could, 
in cultivation, just pay the profits of stock, would now afford 
a rent, and might be brought into cultivation, and that the 
rent would be raised on all land. For the same reason, if the 
price of corn were to fall so as to reduce the profit on the last 
10 acres one per cent, some land would be withdrawn from 
cultivation, and the rent of that land which remained in cul- 
tivation would be lowered. But we know that a rise in the 
price of corn has the effect not only of drawing fresh land into 
cultivation, but also of turning fresh capital on land before 
in cultivation; and that a permanent fall in the price would 
have the effect, not only of withdrawing land from tillage, 
but also the effect of withdrawing part of the capital from 
land which might be still kept in tillage and cultivated in a 
less expensive manner. But if you take the 10 acres of land 
I before mentioned, which return at the given price 20 per 
cent., it would seem impossible for any diminution of price 
under a diminution of one-half to draw capital from such 
land; for if the price of corn were to fall so low as even to 

53 reduce the profit to 11 || per cent., still it might be worth while 
to lay out the same capital, as it would yield one per cent, 
more than capital in any other employment, which one per 
cent, would be the rent. 

This difficulty is explicable on our principle alone. The 
truth is, that any land which returns 20 per cent, on lOOZ., 
must, as I have shewn, return more on a lesser capital than 
lOOZ., and consequently must return more on the first portion 
of 1001. laid out on it than on the latter portion of it, and 
would consequently produce the return somewhat in this way, 
the first lOZ. might reproduce 40 per cent, net produce; the 
second 101. 30 per cent, and so on, and the last layer of capital 
would not produce more than 10 per cent., as the farmer 



The Application op Capital to Land 41 

would, of course, lay on as much capital as would reproduce 
him the common profits of stock, which are supposed to be 
10 per cent. 

The rent of the landlord would then still, as before, be all 
that was made on the whole capital above what the last or 
least profitable portion of that capital produced; and in the 
same manner as before, if the price of corn increased so as to 
make that portion of capital which before produced 10 per 
cent, now produce 11 per cent, another portion of capital 
would be laid on. And in the same manner, if the price of 
corn were to fall so as to reduce || the profits on the last por- 54 
tion of capital from 10 to 9 per cent, that portion would be 
withdrawn. In case, then, of any fall in the price of corn, 
that portion of the capital which before afforded the smallest 
profit Mdll be withdrawn, and that only will be left which 
continues to jdeld an adequate return, and the effect of such 
reduction of price on rent will be nearly as follows : 

Suppose again the case of land let on the calculation of 
the price of wheat at 90s. the quarter, the rent 300L a-year, 
the tenant^s capital amounting to lOOOZ. and his profit on 
that capital to be lOOZ. a-year, the produce is, as before, 1400Z. 
Now, after the reduction of wheat to 60s., if the tenant re- 
tained the same capital on the land, he would not, as I 
shewed, reproduce even his capital, much less be able to pay 
any rent. 

But suppose now on this fall of price he diminishes his 
capital to 800/. 

Since he made on his whole capital of lOOOZ. before the 
reduction of price 400/. i. e. 40 per cent, he must have made 
more than 40 per cent, upon the first 800Z. and even after 
the reduction of price, he may make 40 per cent, on the 800Z. 
that is, 320/. of which his own share, as profit, will be 80/. 
leaving to the landlord 340/. as rent. || 55 

Thus upon this supposition, a fall in the price of corn 
of -J, would reduce rents but -J. The reader will perceive 
that there are many considerations, such as taxes, poor rates, 
and the distress of individuals, arising from a rapid shifting 



42 SiE Edwaed West 

of capital from one employment to another, which I have not 
taken into the account in this essay, and therefore I have not 
pretended to strike the balance of the arguments for and 
against some restriction of importation; it appears to me, 
however, that the principle which it has been my object to 
explain will shew it to be highly impolitic to fix the price 
below which importation is to be checked at a high point. 
Those other considerations would demand a much longer in- 
quiry; upon the whole, I am inclined to think, that it would 
be reasonable to grant to the agriculturist, for the present, 
such protection as would keep up the price of com to '^Os., 
or at the most 755. the quarter. 



OBSEKVATIONS se 

ON THE 

BOUNTY of 1688. 



Another object of this publication is to shew the fallacy 
of the arguments of those who have maintained, that the 
bounty on the exportation of corn granted by the legislature 
in 1688, rendered that article cheap. 

A refutation of this, as I conceive, erroneous doctrine is 
important, not only because such doctrine weakens our reli- 
ance upon the truth of the general rule of political economy, 
that all artificial regulations in commerce are injurious; a 
rule which must frequently be the only guide, even of the 
best informed, when treading a new ground in the science; 
but because such doctrine has been used as a defence of para- 
doxical opinions on the subject of the proposed corn bill. 

I originally took up the subject of the bounty on the ex- 
portation of corn, without any preconceived opinion as to its 
merits; but merely because it forms one of the most promi- 
nent features in the 1st report of the committee of the House 
of Commons, and in Mr. || Malthus's,'" Lord Lauderdale's," 57 
and Sir H. Pamell's " pamphlets. Of course, as the first step, 
I examined the facts from which it had been inferred that the 
bounty had lowered the price of corn, and was not a little 
surprised to find that the facts do not at all support that 
doctrine. This I trust I shall make appear to the reader. 

But before I enter into an examination of the facts, I must 
observe, that the principle which I have stated would shew 
of itself, that if the bounty had any operation at all in in- 
creasing our growth, it must have raised the price in the 
home market above what it would otherwise have been; for 



44 Sir Edwaed West 

that principle shews that a larger growth is raised at a 
greater proportionate expense than a smaller. 

It may be necessary to premise for the information of those 
who may not have given much attention to the subject of the 
corn laws, that in 1688 a bounty of 5s. a quarter was granted 
by the legislature on the exportation of corn, whilst it was at 
or under 48s. the quarter; that this bounty was suspended 
for a single year three or four times, between 1688 and 1765 ; 
that in 1765 it was suspended for a year; and that this sus- 
pension was annually renewed till 1773, when the bounty 

58 was ultimately abolished. | 

Mr. Charles Smith, the author of the Corn Tracts, fre- 
quently mentioned in the Wealth of Nations, was, as far as 
I am informed, the first writer who maintained that the 
bounty on exportation had the effect of reducing the price 
of corn. His opinion has been adopted by many later writ- 
ers, but with, as I shall presently prove, much less shew of 
reason than that author had, considering the facts which 
have subsequently occurred. One of the passages in which 
Mr. C. Smith expresses this doctrine is as follows. 

" The bounty was first given on the exportation of grain 
in the year 1689,* now seventy years since, during which 
period grain hath in general been from fifteen to twenty 
per cent, cheaper than for forty years before that time, which 
is a good proof of the utility of the law by which it is ordered 
to be given, and which is further proved, in that since its 
first establishment the parliament have not thought fit to 
suspend it either in part, or the whole, only four times, viz. 
in 1698, 1709, 1740, and 1757, which last suspension is still 
in force, and to continue to Christmas next.'' 

" That corn has been as much cheaper since the bounties 

59 took place as before men- || tioned, is so notorious, that the 
prices thereof to which the bounties are payable by law, 
which when first established were thought moderate, and 
under which the then parliament thought the farmer could 

* This was written in January, 1759. 



The Application of Capital to Land 45 

not afford to grow it, are now thought very dear, and long 
before corn is sold at those prices at which the bounties are 
to cease of course, we have of late heard clamours for taking 
the bounty off and stopping the exportation." * 

There can be no doubt that the average price of corn for 
a period of several years, during the existence of the bounty 
on exportation, was lower than at any period of the same 
length before or since. 

But that this low price of corn cannot with any fairness 
be attributed to the bounty, will appear from an examination 
of the tables of the prices for a considerable period before 
the grant of the bounty, and during its continuance, and 
after its abolition. It will be found that the average price 
of corn for ten years 

Average of 20 Tears. 
£2 6 10 



10 



From 


1649 




£ 


s. 


d. 


to 


1658 


was 


2 


7 





From 


1659 










to 


1668 


was 


2 


6 


8 


From 


1669 










to 


1678 


was 


3 


3 


4 


From 


1679 










to 


1688 


was 


1 


18 


4 


From 


1689 










to 


1698 


was 


2 


7 





From 


1699 










to 


1708 


was 


1 


13 


9 


From 


1709 










to 


1718 


was 


3 


7 


5 


From 


1719 










to 


1728 


was 


1 


16 


3 


From 


1739 










to 


1738 


was 


1 


13 


7 


From 


1739 










to 


1748 


was 


1 


11 


9 



3 



1 10 



1 13 



It appears therefore that the price of corn had uniformly 
declined during thirty years before the grant of the bounty. 
For the ten years immediately after the grant of the bounty 
it rose considerably, the next ten years fell again, and then 
for the subsequent ten rose again much higher than it had 
been before the grant of the bounty. And if you take the 
fall in price for thirty years before the bounty it will be 

* Smith's Corn Tracts, p. 99.'" 



60 



46 Sir Edward West 

found greater than that which took place even for sixty years 
after it, and not only greater in amount but greater in pro- 
portion. For the price of corn fell, in thirty years, before 
the bounty, from 21. 7s. to 11. 18s. 4:d., that is 8s. Sd. But 
the price of corn even in the lowest ten years after the bounty 
(from 1739 to 1748) was 1/. lis. 9d. which from 11. 18s. M. 
is a fall of but 6s. 7d. 
61 I cannot conceive any state of facts which || would lead 
more directly than these to a conclusion the very opposite to 
that which the advocates of the bounty have drawn from 
them. A consideration of the subsequent rise of price after 
its greatest depression in 1743 and 1744 will equally shew 
that as a grant of the bounty was not the cause of the low 
price of corn, neither was the repeal of it the cause of the 
high price.* It will be found that the average price of 



price.* 


It 


for ten 


years 


From 


1744 


to 


1753 


From 


1754 


to 


1763 


From 


1764 


to 


1773 


From 


1774 


to 


1783 


From 


1784 


to 


1793 



£. s. d. 
1 11 9 

1 16 4 



10 11 



Bounty repealed. 



It appears therefore that the price of corn began to rise 

twenty years before the repeal of the bounty, that for ten 

years after the repeal instead of continuing to rise it rather 

fell, and then began again to rise, but not near so rapidly as 

62 it had done before the repeal of the bounty. || 

If instead of the years I have selected the average be 
taken from any other point the result will be similar. Thus, 
take the ten cheapest years, and then periods of ten years on 
each side. The cheapest period in all our annals was from 

* Surely it was not very bold, as Mr. Malthus asserts of Dr. 
Smith, to deny the influence of the bounty in reducing the price 
of corn. (See Essay on Population," vol. ii, p. 240.) 



The Application of Capital to Land 47 

1743 to 51. And it will be found that the price regularly 
sinks as it approaches to, and ascends as it recedes from this 
period. Thus the average of ten years 



From 
to 


1702 : 

1711 ; 


was 


;^- 


s. 
19 


d. 
10 


From 
to 


1712 ) 
1721 f 


was 




18 





From 
to 


1722 I 
1731/ 


was 




16 


10 


From 
to 


1732) 

1741 \ 


was 




14 


4 


From 
to 


1742 J 
1751 f 


was 




9 


4 — Lowest. 


From 
to 


1752 
1761 " 


was 




17 





From 
to 


1763 
1771 ■ 


was 


2 


4 


10 


From 
to 


1772 ) 
1781 [ 


was 


2 


9 





From 
to 


1782 1 
1791/ 


was 


2 


10 






For more than twenty years then before the recal of the 
bounty, (1773,) the price of corn had begun to rise. It is 
clearly right to take || for this purpose the date of the total 63 
abolition of the bounty, not the time (1765) at which the 
annual suspension began, as the epoch of the recall, (though 
Sir H. Parnell contends the contrary.) The annual suspen- 
sion could not have destroyed the effect of the bounty, being 
merely on account of the actual high price and temporary, so 
that the growers would look forward to the renewal of the 
bounty, when it could be of any service to them, namely, 
when prices were low, and must have had the same encour- 
agement from it as before. I may notice here, that if any 
allowance of time is to be made for the bounty to come into 
operation after it was granted, an equal allowance should be 
made for it to cease to operate after its repeal. For if the 
farmers could not immediately adapt themselves to the new 
state of things when the bounty was granted, they would 
probably require the same space of time to adapt their pro- 
ceedings to the repeal of the bounty. It is proper, however, 



48 SiH Edward West 

to observe that the price of corn really began to rise from the 
year 1744, which an examination of the tables will prove. 
The rise, therefore, commenced twenty-nine years before the 
repeal of the bounty, and twenty-one years before the annual 
suspension. In fact, the low price of corn was the cause of the 

64 grant of the bounty, and it was || so expressed by the legisla- 
ture. The year 1687 was a cheaper year than any in our 
records, except the years 1743 and 1744; — (the average price 
of the quarter of corn for the year 1687 was 11. 2s. 4|tZ. ; in 
the years 1743 and 44 it was two-pence cheaper.) In 1688 
the act which granted the bounty on the exportation of com 
was passed. And the preamble runs that, " Forasmuch as it 
has been found by experience that the exportation of corn 
and grain into foreign parts, when the price thereof is at a 
low rate in this kingdom, has been a great advantage not 
only to the owners of land, but to the trade of this kingdom 
in general: Be it therefore," &c. 

It is well known by all who are conversant with the his- 
tory of that period, that it was the high price of corn, in 
1773, which raised a clamour against the bounty, and in- 
duced the legislature to repeal it; * so that in each case the 
jjrice of corn was the cause of legislative interference, and 
not the effect. Corn was cheap, and exportation was natu- 
rally not only allowed but encouraged ; corn became dear, and 
exportation was as naturally prohibited, yet, because the 
cheapness continued under that encouragement, and the dear- 
ness was not removed by the prohibition, it has been argued 

65 that the || encouragement to export was the cause of the cheap- 
ness, and the prohibition of exportation the cause of the dear- 
ness. 

Mr. Malthus has put the argument in favour of the bounty 
in another shape, supposing it had the effect of steadying the 
price of corn, and of lowering it on the whole by keeping it 
down in scarce years, though he allows it may have raised 

* See Smith's Corn Tracts, passim. 



The Application of Capital to Land 49 

it in plentiful years. See Malthus's Essay on Pop. pp. 239, 
240, &c. and 259. 261.'° 

Let "US inquire then whether the price of corn fluctuated 
more during the period of the bounty than at any other. In 
order to ascertain the average degree of variation in different 
periods of 30 years, I have taken the average price of the 
ten dearest years, and the average price of the ten cheapest 
years, in several different periods of twenty years; and have 
set down the ratios of the higher prices to the lower. And 
if the dearest and cheapest single years in any twenty be 
taken, the ratio will be found nearly the same : 

Ratio. Variation. 

From 1649 to 1668 as 29 to 17 as 170 : 100 170 

1669 — 1688 — 23 — 17 — 185 : 100 135 

1689 — 1708 — 25 — 14 — 178 : 100 178 

1709 — 1728 — 34 — 17 — 141 : 100 141 

1729 — 1748 — 18 — 13 — 138 : 100 138 

1749 ~ 1768 — 22 — 16 — 137 : 100 137 

1769 — 1788 — 26 — 21 — 123 : 100 123 || 66 

It appears that the variations in the price of corn in the 
twenty years immediately preceding the grant of the bounty, 
and in the twenty years immediately after the repeal of the 
bounty, were much less than during any period of twenty years 
during the existence of the bounty. I have made the calcula- 
tion in different ways, and can venture to assert, also, that the 
variation, during any period of moderate length, since the 
alteration of the corn laws, in 1773 till 1794, has been much 
less than during any period of the same length while the 
bounty was in force. 



FINIS. 



50 



Sir Edwaed West 



67 



APPENDIX. 



Prices of Wheat per Quarter at Windsor Market* 



68 



YEARS. 


Prices of Wheat, 

reduced to 

the Winchester 

Bushel 

of 8 Gallons. 


YEARS. 


Prices of Wheat, 

reduced to 

the Winchester 

Bushel 

of 8 Gallons. 




£. s. d. 




£. s. d. 


1646 


2 2 8 


1676 


1 13 9J 


1647 


3 5 5f 


1677 


1 17 4 


1648 


3 15 6| 


1678 


2 12 51 


1649 


3 11 11 


1679 


2 13 4 


1650 


3 8 If 


1680 


2 


1651 


3 5 21 


1681 


2 1 5f 


1652 


2 4 


1682 


1 19 li 


1653 


1 11 6| 


1683 


1 15 6f 


1654 


1 3 li 


1684 


1 19 1\ 


1655 


1 9 7^ 


1685 


2 1 5f 


1656 


1 18 2J 


1686 


1 10 2f 


1657 


2 1 5| 


1687 


1 2 4^ 


1658 


2 17 9i 


1688 


2 10| 


1659 


2 18 8 


1689 


16 8 


1660 


2 10 2a 


1690 


1 10 9f 


1661 


3 2 2f 


1691 


1 10 2f 


1662 


3 5 9J 


1692 


2 1 5f 


1663 


2 10 8 


1693 


3 If 


1664 


1 16 


1694 


2 16 lOf 


1665 


2 3 lOJ 


1695 


2 7 IJ 


1666 


1 12 


1696 


3 3 li 


1667 


1 13 


1697 


2 13 4 


1668 


1 15 6f 


1698 


3 9 


1669 


1 19 5 


1699 


2 16 10| 


1670 


1 17 Oi 


1700 


1 15 6| 


1671 


1 17 4 


1701 


1 13 5f 


1672 


1 16 51 i 


1702 


1 6 2f 


1673 


2 1 5f 


1703 


1 13 


1674 


3 1 Oi 


1704 


3 14 


1675 


3 17 5| 


1705 


16 8 II 


* These 


are the Prices of Mealing 


fVheat; wh 


ch is understood, at Eton 



College, to be of a middling Quality. 



The Application- of Capital to Land 



51 



years. 


Prices of Wheat, 

reduced to 

the Winchester 

Bushel 

of 8 Gallons. 


teaes. 


Prices of Wheat, 

reduced to 

the Winchester 

Bushel 

of 8 Gallons. 




£. s. d. 




£. s. d. 


1706 


1 3 IJ 


1746 


1 14 8 


1707 


15 4 


1747 


1 10 Hi 


1708 


1 16 lOf 


1748 


1 12 lOj 


1709 


3 9 9J 


1749 


1 12 lOf 


1710 


8 9 4 


1750 


1 8 lOf 


1711 


3 8 


1751 


1 14 2f 


1712 


3 1 3J 


1752 


1 17 21 


1713 


2 5 4 


1753 


1 19 H 


1714 


3 4 9 


1754 


1 10 9J 


1715 


1 18 3| 


1755 


1 10 1 


1716 


2 2 8 


1756 


2 If 


1717 


2 7J 


1757 


3 13 4 


1718 


1 14 6J 


1758 


2 4 5^ 


1719 


1 11 li 


1759 


1 15 3 


1730 


1 13 lOj 


1760 


1 12 SJ 


1731 


1 13 4 


1761 


1 6 9J 


1733 


1 12 


1762 


1 14 8 


1723 


1 10 lOJ 


1763 


1 16 If 


1724 


1 13 lOf 


1764 


2 1 5f 


1725 


3 3 IJ 


1765 


2 8 


1726 


3 lOf 


1766 


2 3 li 


1737 


1 17 4 


1767 


3 17 4 


1738 


3 8 5i 


1768 


3 13 9i 


1729 


2 1 7J 


1769 


2 7 


1730 


1 13 5i 


1770 


2 3 6f 


1731 


1 9 3J, 


1771 


2 10 8 


1733 


13 8^ 


1772 


2 18 8 


1733 


1 5 31 


1773 


2 19 IJ 


1734 


1 14 6J 


1774 


3 15 IJ 


1735 


1 18 3f 


1775 


2 11 3^ 


1736 


1 15 lOj 


1776 


2 2 8 


1737 


1 13 9^ 


1777 


3 8 lOf 


1738 


1 11 6f 


1778 


3 4 


1739 


1 14 2f 


1779 


1 16 If 


1740 


3 5 li 


1780 


3 3 1^ 


1741 


2 1 5f 


1781 


3 13 5J 


1742 


1 10 2| 


1782 


2 13 9^ 


1743 


12 1 


1783 


2 14 2f 


1744 


12 1 


1784 


2 13 9^ 


1745 


1 4 5J 


1785 


2 8 Ojl 



69 



52 



SiK Edward West 



YEARS. 


Prices of Wheat, 

reduced to 

the Winchester 

Bushel 

of 8 Gallons. 


TEARS. 


Prices of Wheat, 

reduced to 

the Winchester 

Bushel 

of 8 Gallons. 




£. s. d. 




£. s. d. 


1786 


2 2 2f 


1800 


6 7 


1787 


2 5 9J 


1801 


6 8 6 


1788 


2 9 4 


1802 


3 7 2 


1789 


2 16 If 


1803 


3 


1790 


2 16 If 


1804 


3 9 6 


1791 


2 9 4 


1805 


4 8 


1793* 


2 13 


1806 


4 3 


1793 


2 15 8 


1807 


3 18 


1794 


2 14 


1808 


3 19 2 


1795 


4 16 


1809 


5 6 


1796 


4 2 


1810 


5 12 


1797 


3 2 


1811 


5 8 


1798 


2 14 


1812 


6 8 


1799 


3 15 8 


1813 


6 



*Prom this year, inclusive, the account at Eton College has been kept 
according to the Bushel of Bight Gallons, under the provisions of the Act of 
31 G. 3. c. 30. sect. 82. 



London. Printed by C. Koworth, 
Bell-yard, Temple-bar. 



NOTES 

^ (page 9) (a) " Report from the Select Committee on Petitions 
relating to the Corn Laws of this Kingdom; together with the 
Minutes of Evidence, and an Appendix of Accounts. Ordered, by 
The House of Commons, to be printed, 26 July, 1814." 

(b) " Reports respecting Grain, and the Corn Laws: viz: 
First and Second Reports from the Lords Committees, appointed 
to enquire into the state of the growth, commerce, and consump- 
tion of grain, and all laws relating thereto;— to whom were re- 
ferred the several petitions, presented to the House this session, 
respecting the Corn Laws.— 25 July, 1814. Communicated by The 
Lords, 23d November, 1814. Ordered, by The House of Commons, 
to be printed, 23 November, 1814." 

' (page 11) The text of the " Wealth of Nations " used and 
cited by West is apparently that of the ninth edition (3 vol. 8°. 
London, 1809); the "new edition" (3 vol. 8°), issued by Cadell 
and Davies in 1812, corresponds in pagination, in the main, with 
the ninth. This, as other citations from and references to Adam 
Smith's work in West's text, contains minor inaccuracies, notably 
an unwarranted use of italics. 

' (page 20) The passage actually occurs in the second para- 
graph of chapter ix. 

* (page 22) In the original text an asterisk is used. 

" (page 25) See note 1, above. 

" (page 28) " The Substance of the Speeches of Sir H. Parnell, 
Bart, in the House of Commons w^ith additional observations on 
the corn laws" (London, 1814). This, as well as subsequent 
citations, contains minor typographical inaccuracies. 

' (page 32) The passage is quoted loosely. 

' (page 34) " Essays and Treatises on Several Subjects. In 
two volumes. By David Hume, Esq.; Vol. 1, Containing Essays, 
Moral, Political, and Literary. A new edition" (London, 1764). 

° (page 35) "An Essay on the Principle of Population; or, 
a view of its past and present effects on human happiness; with 
an inquiry into our prospects respecting the future removal or 
mitigation of the evils which it occasions " (2 vol. 3rd. edit. Lon- 
don, 1806). West's page reference to Malthus's text is incorrect, 
the passage actually occurring on pp. 208-209. 

'" (page 43) " Observations on the Effects of the Corn Laws, 
and of a rise or fall in the price of corn on the agriculture and 
general wealth of the country" (London, 1815). 



54 Notes 

" (page 43) "A Letter on the Corn Laws " (London, 1814). 

" (page 43) See note 6, above. 

" (page 45) " Tracts on the Corn Trade and Corn-Laws. By 
Charles Smith, Esq. A new edition. With additions from the 
marginal manuscripts of Mr. Catherwood. To which is now added 
a supplement of interesting pieces on the same subject. With 
some account of the life of Mr. Smith" (London, 1804). 

" (page 46) See note 9, above. 

" (page 49) See note 9, above. 



CT 3 1903 



LIBRARY OF CONGRESS 



000 988 677 1 



